Working Paper Revision
The Heterogeneous Impacts of Job Displacement: Evidence from Canadian Job Separation Records
Abstract: When estimating earnings losses upon job separations, existing strategies focus on mass-layoff separations to distinguish involuntary separations from voluntary separations. We revisit the measurement of the sources and consequences of involuntary separations using Canadian job separation records. We refine existing strategies and find that only a quarter of mass-layoff separations are indeed layoffs. Isolating mass-layoff separations that reflect involuntary displacement, we find twice the earnings losses relative to existing estimates. We also uncover significant heterogeneity in losses for separations with different reasons and timing, ranging from 10% for quits after a mass layoff to 60% for layoffs before it.
Keywords: job displacement; earnings losses; layoffs versus quits; employer effects;
JEL Classification: E24; E32; J31; J63; J65;
https://doi.org/10.20955/wp.2023.022
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Provider: Federal Reserve Bank of St. Louis
Part of Series: Working Papers
Publication Date: 2024-11-14
Number: 2023-022
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